Bulgaria's gas provider Bulgargaz has asked the State Energy and Water Regulatory Commission (SEWRC) to increase gas prices by 36.51 per cent, starting on October 1.

According to Bulgargaz, soaring alternative fuel prices, rising US dollar exchange rates and the lower third-quarter price approved by SEWRC had prompted the demand. The watchdog can either approve or reduce the price hike request, Dnevnik daily said.

SEWRC said that it was unlikely to approve the price increase offered.

Valentin Terziiski, head of the association of heating companies said that Bulgargaz required a record-breaking price increase. Between July 2007 and July 2008, the gas price had increased by 39 per cent.

Dnevnik quoted a representative of a coalition of Bourgas, Pleven, Sliven and Vratsa heating companies as saying that the increase required was "insane and will be fatal for Bulgarian energy". There was a possibility that people would start using electricity for heating, which would lead to an energy crisis as early as the winter of 2008, the source said.

At the beginning of September, Bulgargaz said that Bulgaria was on the brink of an unprecedented gas crisis because of heating companies' (the Toplofikatsiya utilities around the country) unpaid debts. Bulgargaz was urgently trying to collect at least 80 million leva from its debtors, the Sofia, Pleven, Vratsa and Bourgas heating companies, to pay Russian gas provider Gazprom. The companies' debts to Bulgargaz amounted to 230 million leva. If the company failed to collect its clients' unpaid debts, the country might have to buckle down on gas usage, private broadcaster bTV then said.